Page:United States Statutes at Large Volume 100 Part 2.djvu/350

 100 STAT. 1452

PUBLIC LAW 99-498—OCT. 17, 1986

and after consultation with the State educational agency of the '' - ^ ' State in which the school is located) to be a school in which the "'- mentary and Secondary Education Act of 1965 exceeds 30 percent of the total enrollment of that school and such determination shall not be made with respect to more than 50 percent of the total number of schools in the State receiving assistance under such title I; "(B) as a full-time staff member in a preschool program carried on under section 222(a)(1) of the Economic Opportunity 42 USC 2809. Act of 1964 which is operated for a period which is comparable to a full school year in the locality if the salary of such staff V » member is not more than the salary of a comparable employee < of the local educational agency; "(C) as a full-time teacher of handicapped children in a public or other nonprofit elementary or secondary school system; "(D) as a member of the Armed Forces of the United States, for services that qualifies for special pay under section 310 of title 37, United States Code, as an area of hostilities; or 22 USC 2501 "(E) as a volunteer under the Peace Corps Act or a volunteer note. under the Domestic Volunteer Service Act of 1973. '*2 USC 4951 PQJ. ^jig purpose of this paragraph, the term 'handicapped children' "° • , has the meaning set forth in section 602(1) of the Education of the Handicapped Act. "(3)(A) The percent of a loan which shall be canceled under paragraph (1) of this subsection is— "(i) in the case of service described in subparagraph (A) or (C) B- of paragraph (2), at the rate of 15 percent for the first or second year of such service, 20 percent for the third or fourth year of such service, and 30 percent for the fifth year of such service; "(ii) in the case of service described in subparagraph (B) of .; paragraph (2), at the rate of 15 percent for each year of such service; "(iii) in the case of service described in subparagraph (D) of paragraph (2), not to exceed a total of 50 percent of such loan at the rate of 12 ¥2 percent for each year of qualifying service; or "(iv) in the case of service described in subparagraph (E) of . paragraph (2) at the rate of 15 percent for the first or second year of such service and 20 percent for the third or fourth year of such service. "(B) If a portion of a loan is canceled under this subsection for any year, the entire amount of interest on such loan which accrues for iJ ''i. such year shall be canceled. "(C) Nothing in this subsection shall be construed to authorize refunding of any repayment of a loan. "(4) For the purpose of this subsection, the term 'year' where applied to service as a teacher means academic year as defined by the Secretary. "(5) The amount of a loan, and interest on a loan, which is canceled under this section shall not be considered income for 26 USC 1 et seq. purposes of the Internal Revenue Code of 1954. "(b) REIMBURSEMENT FOR CANCELLATION.—The Secretary shall pay to each institution for each fiscal year an amount equal to the aggregate of the amounts of loans from its student loan fund which [<,, are canceled pursuant to this section for such year, minus an amount equal to the aggregate of the amounts of any such loans so canceled which were made from Federal capital contributions to its
 * c enrollment of children counted under section 111(c) of the Ele20 USC 2711.

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